Renowned economist Steve Hanke recently released the Annual Distress Index also known as (HAMI) which assesses countries based on their prosperous economic status. Here’s what you need to know!
What is the Steve Hanke Annual Misery Index (HAMI)?
The poverty index is a measure of economic hardship. Previously, it was calculated by adding the unemployment rate and the inflation rate. The higher the poverty index, the worse the economy.
The economist Arthur Okun created the misery index in the 1970s. He was trying to find a way to measure the general happiness of the American people. Okun believes that unemployment rate and inflation rate are the two most important factors affecting people’s lives.
Then, Harvard professor Robert Barro later modified the index by adding interest rates. And now Steve Hanke has changed that.
He mentioned “I further modified Barr’s version of the misery index by replacing the yield gap with real GDP growth per capita and substituting the yield on the 30-year government bond with the borrowing rate. After all, higher interest rates mean more expensive loans and more miserable borrowers.”
Steve Hanke’s latest distress index doubles the unemployment rate, and the data is based on it. Steve stated on his blog, “Oswald argues that the misery index should not be a simple sum of its factors, but that the unemployment rate should be more weighted.
“He proposed doubling the unemployment rate. After reading Oswald’s work, I concluded that Oswald was up to something and then accepted his proposal. Thus, for the first time, the index Hanke’s annual misery for 2022 will double the unemployment rate component.”
Which country suffers the most?
As reported by Steve Hanke, Zimbabwe is the most miserable country in the world. The poverty index in the country is 414.7 due to high inflation.
Venezuela, Syria, Lebanon and Sudan are struggling economically. Inflation is a major cause of misery in Venezuela, Lebanon and Sudan. On the other hand, Syria suffers from poverty because of unemployment.
India ranks 103 with a misery index of 22.58. The main cause of misery in India is unemployment. Here is a list of the 20 most miserable countries according to HAMI:
Rating (from worst to best) | Earth | Suffering Index | An important contributing factor |
| first. | Zimbabwe | 414.7 | inflationary |
| 2. | Venezuela | 330.8 | inflationary |
3. | Syria | 225.4 | Unemployment |
| 4. | Lebanon | 190,337 | inflationary |
5. | sudan | 176.1 | inflationary |
6. | Argentina | 156.192 | inflationary |
7 | Yemen | 116.2 | inflationary |
8. | Ukraine | 110.003 | Unemployment |
9. | Cuba | 102 | inflationary |
ten. | Türkiye | 101,601 | inflationary |
11. | Sri Lanka | 99.634 | inflationary |
twelfth. | Haitian | 95.4 | inflationary |
13. | Angola | 93.518 | Unemployment |
14. | Shandrydan | 88.1 | Unemployment |
15. | gana | 86.8 | inflationary |
16. | South Africa | 83.492 | Unemployment |
17. | Suriname | 80.5 | inflationary |
18. | Bosnia and Herzegovina | 75.9 | Unemployment |
19. | Iran | 73.3 | inflationary |
20. | Rwanda | 69,192 | inflationary |
According to the study, Switzerland ranks 157th with a misery index of just 8,518, making it the least miserable country. Steve State “One of the reasons for this is the Swiss debt brake.
“The debt brake has worked well. Unlike most countries, Switzerland’s debt-to-GDP ratio has been on a downward trend over the past two decades, since the country introduced the debt brake in its constitution for a year. national referendum in 2002.”
The main challenge facing Zimbabwe is its ZANU-PF government. Steve Hanke stated in his blog “Indeed, ZANU-PF operates more like a political mafia organization than a political party. His policies have led to great misery.”
He has been monitoring Zimbabwe’s economy since 2008 when Robert Mugabe was president.
Categories: Trends
Source: vcmp.edu.vn